[New York Stock Market] Rise on Tech Stock Rebound Including Apple... Nasdaq Up 1.35%

The three major indices of the U.S. New York stock market all closed higher on the 18th (local time), buoyed by a rebound in technology stocks including Apple.

On the day at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average, which focuses on blue-chip stocks, closed at 37,468.61, up 201.94 points (0.54%) from the previous session. The S&P 500, centered on large-cap stocks, ended at 4,780.94, up 41.73 points (0.88%), and the tech-heavy Nasdaq closed at 15,055.65, rising 200.03 points (1.35%).

Within the S&P 500, technology, communication, and industrial sectors rose, while utilities, real estate, and energy sectors declined. Apple, which had shown weakness earlier this year, rose 3.26% after Bank of America (BoA) upgraded its investment rating and raised its target price. Major semiconductor stocks such as Taiwan's TSMC, Nvidia, AMD, Intel, and Qualcomm also showed gains following TSMC's better-than-expected earnings. Qualcomm jumped more than 4%. Tesla, which has been lowering the price of its Model Y in major markets, fell more than 1% on the day.

[Image source=Reuters Yonhap News]

Investors focused on Apple's stock rebound, movements in Treasury yields, economic indicators, and the future direction of the Federal Reserve's (Fed) monetary policy. In particular, Apple's stock rebound helped revive investor sentiment centered on technology stocks. TSMC's earnings also supported the semiconductor rally. Amid growing caution over early rate cut expectations, these technology stocks are seen as safe havens.

Ross Mayfield, investment strategy analyst at Baird, said, "The latest news from TSMC positively impacted forward guidance surrounding semiconductors and artificial intelligence (AI)," adding, "We saw a rise in technology stocks." Jay Hartfield, CEO of Infrastructure Capital Management, mentioned the rising Treasury yields and said, "Technology stocks are a safe haven when interest rates rise."

The weekly initial jobless claims released that day fell to the lowest level since September 2022. According to the Department of Labor, the number of new weekly jobless claims as of the 13th decreased by 16,000 from the previous week to 187,000, indicating that the labor market remains robust. Retail sales for December of last year, released the previous day, also showed stronger-than-expected results, dampening market expectations for a rate cut in March. However, the Fed's Beige Book released the previous day noted signs of cooling in the overheated labor market that had been fueling inflation.

Hawkish remarks from Fed officials were also added. Raphael Bostic, president of the Federal Reserve Bank of Atlanta, said that the first rate cut would likely be possible only in the third quarter. At an event hosted by the Atlanta Business Chronicle, Bostic mentioned potential concerns about the U.S. presidential election and geopolitical risks from the Middle East affecting the economy, emphasizing the need for the Fed to proceed cautiously with rate cuts. He said, "In my outlook, the first rate cut will occur in the third quarter of this year, but we need to see how the data unfolds," adding that if inflation slows much faster than expected, the Fed could act sooner. Economic media CNBC assessed Bostic's remarks as later than market expectations but earlier than his previous statements.

In the New York bond market, the benchmark 10-year U.S. Treasury yield rose slightly to around 4.13%. The 2-year yield, sensitive to monetary policy, hovered around 4.35%. The dollar index, which measures the value of the dollar against six major currencies, remained steady at about 103.4.

International oil prices rose on news that the International Energy Agency (IEA) raised its oil demand forecast. On the New York Mercantile Exchange, the price of West Texas Intermediate (WTI) crude for February delivery closed at $74.08 per barrel, up $1.52 (2.09%) from the previous day.